Nifty Outlook For Next Week - Trading Strategy

After a consistent rally of past 8 weeks, Nifty Futures is consolidating between 5,450 and 5,300. Now, the important levels to watch are placed at 5,320 and 5,250. We expect Nifty Futures to stay above 5250 and upward breakout is placed at 5,460. Once, the breakout is materialized, Nifty Futures is likely to test 5,510 levels and the positional target is near 5,600 levels. On downward side, if 5,250 is breached, then strong support is placed at 5,150 which is 200-day EMA.

The current uptrend is indicating intermediate trend reversal and higher top and higher bottom formation is expected to continue. Mid-cap and small cap sector stocks are likely to outperform. We recommend buying in these stocks with well-defined stop losses, long positions near 5450 and trailing stop losses for long positions to 5,320.